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COUNTRYSIDE OIL CO. v. TRAVELERS INS. CO.

September 20, 1995

COUNTRYSIDE OIL COMPANY, INC., Plaintiff
v.
TRAVELERS INSURANCE COMPANY, Defendant



The opinion of the court was delivered by: CHESLER

 STANLEY R. CHESLER, U.S. Magistrate Judge

 I. INTRODUCTION

 This matter comes before the Court on the motion of defendant, Travelers Insurance Company, for summary judgment. The parties consented to have this action heard by the undersigned, see 28 U.S.C. § 636(c), and all proceedings regarding this matter have been referred to the undersigned for disposition. Oral argument on this motion was heard on June 12, 1995. For the reasons set forth herein, the Court will grant defendant's motion for summary judgment, and will dismiss the above-captioned action in its entirety.

 II. BACKGROUND

 The gravamen of this action is a dispute over whether defendant, Travelers Insurance Company ("Travelers"), must provide insurance coverage to plaintiff, Countryside Oil Company, Inc., ("Countryside") for losses and expenses arising from the cleanup of an accidental oil spill from one of Countryside's trucks Subject matter jurisdiction lies in this Court on the basis of diversity of citizenship under 28 U.S.C. § 1332. Plaintiff is a New Jersey corporation, defendant is a Connecticut corporation, and the amount in controversy exceeds $ 50,000. Complaint at PP 1-2, 5.

 Countryside is engaged in the home fuel oil delivery business. Affidavit of Harold Finch at P 2 ("Finch Aff."). Countryside purchased from Travelers an insurance policy *fn1" , effective from September 12, 1992, to September 12, 1993, which provided coverage for commercial general liability and commercial automobiles. Finch Aff. at P 3; Harry M. Baumgartner Certification, Ex. A ("Baumgartner Certif."). Countryside purchased the policy through Triangle Insurance Services, Inc. ("Triangle") and remitted the policy premium payments directly to Triangle. Finch Aff. at P 3.

 Travelers and Triangle had entered into a "commercial lines agency contract" wherein Triangle was "given the written authority to write Property-Casualty Commercial Lines policies" on behalf of Travelers. Rodgen Aff., Ex. F. The agency agreement provides in relevant part:

 
2. Except as specifically authorized in writing by the Company, the Agent has no authority to make, alter, vary or discharge any policy contract, to extend the time of repayment of premiums, to waive or extend any policy obligation or condition, to place any advertisement regarding the Company, or to incur any liability on behalf of the Company.

 Rodgen Aff., Ex. F. at P I.2.

 The policy purchased by Countryside in September of 1992 was a renewal of a policy which was effective from 1991 to 1992. *fn2" Both policies contained identical provisions dealing with the exclusion of pollution coverage. Compare Rodgen Aff., Ex. A (as to 1991-1992 policy) with Baumgartner Certif., Ex. A (as to 1992-1993 policy). Section two of the commercial general liability coverage policy contained the following coverage exclusions:

 
2. Exclusions.
 
This insurance does not apply to
 
* * *
 
f(1) "Bodily injury" or "property damage" arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of pollutants:
 
(a) At or from any premises, site or location which is or was at any time owned or occupied by, or rented or loaned to, any insured;
 
(b) At or from any premises, site or location which is or was at any time used by or for any insured or others for the handling, storage, disposal, processing or treatment or waste;
 
(c) Which are or were at any time transported, handled, stored, treated, disposed of, or processed as waste by or for any insured or any person or organization for whom you may be legally responsible; or
 
(d) Which arises out of "your work" or the work or operations of any contractors or subcontractors who work or worked directly or indirectly on your behalf; or
 
(e) Which arises out of "your product".
 
(2) Any loss, cost or expense arising out of any:
 
(a) Request, demand or order that any insured or others test for, monitor, clean up, remove, contain, treat, detoxify or neutralize, or in any way respond to, or assess the effects of pollutants; or
 
(b) Claim or suit by or on behalf of a governmental authority for damages because of testing for monitoring, cleaning up, removing, containing, treating, detoxifying or neutralizing, or in any way responding to or assessing the effects of pollutants.
 
Pollutants means any solid, liquid, gaseous, or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals and waste. Waste includes materials to be recycled, reconditioned or reclaimed.

 Baumgartner Certif., Ex. A at 3. The commercial automobile policy also contained a pollution exclusion which reads:

 
B. EXCLUSIONS
 
This insurance does not apply to any of the following:
 
* * *
 
11. POLLUTION
 
"Bodily injury" or "property damage" arising out of the actual, alleged or threatened discharge, dispersal, seepage, migration, release or escape of "pollutants":
 
a. That re, or that are contained in any property that is:
 
1. Being transported or towed by, handled, or handled for movement into, onto or from, the covered "auto";
 
2. Otherwise in the course of transit by the "insured";
 
"Pollutants" means any solid, liquid, gaseous or thermal irritant or contaminant, including smoke, vapor, soot, fumes, acids, alkalis, chemicals, and wastes. Waste includes ...

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